The City negotiates and enters into labor agreements with its various collective bargaining units.  The current agreement expired June 30, 2018. The City and Operating Engineers Local No. 3 Non-Supervisory Unit submit for your consideration a three (3) year Agreement covering July 1, 2018 through June 30, 2021.

The negotiation teams for both parties began meeting in February 2018 and continued to meet regularly to discuss the terms and conditions of this Agreement. The Agreement proposed today is the result of those meetings. The City and Operating Engineers Local No. 3 Non-Supervisory Unit believe this Agreement to be a fair, good faith effort between both parties. Operating Engineers Local No. 3 Non-Supervisory Unit ratified this Agreement with their membership and now the City’s negotiating team recommends ratification and approval by council.

Following is a summary of the Agreement reached between the parties.  This summary outlines negotiated contract changes. Also attached to this agenda item are a strike-out version of the proposed Agreement and the final version of the proposed Agreement.

Summary of Tentative Agreement

Section 1: Administration, Article D: Duration of the Agreement

This section reflects the new contract period of July 1, 2018 through June 30, 2021.  There is no direct cost related to this contract change.

Section 1: Administration, Article J: Job Stewards and Union Business

New language was added to increase communication between the Union and the City.  Once per month the City will provide to the City and the Operating Engineers Local No. 3 Non-Supervisory Unit Business Representative a list of new employees hired by the City into positions listed in Appendix A. There is no direct cost related to this contract change.

Section 2: Pay, Article A: Pay Rates

There are two (2) changes to this article in the new agreement. First, consideration of a classification and compensation system to establish pay levels and their associated pay bands. With council approval of an item heard earlier today, changes are needed in the contract to implement the system. Second, this article contains the agreed upon Cost of Living Adjustment (COLA) for each year of the three (3) year contract term.

New Classification and Compensation System

A new contract section and a new Appendix A were added to implement the City’s new classification and compensation system effective October 1, 2018.

The new section of the Agreement explains that pay ranges are to be established utilizing a systematic classification and compensation system. The actual pay rates established through the classification and compensation system are listed by position in the Appendix A. This information also addresses how to handle an employee’s salary when either above or below the new pay range.

The updated Appendix A incorporates the agreed upon changes with Operating Engineers Local No. 3 Non-Supervisory unit and includes changes to titles and positions effective October 1, 2018 as follows:

1. Position titles no longer in use were eliminated.
2. New position titles were added.
3. Where two positions in a job family had substantially similar minimum requirements and job duties, positions were merged by removing the I/II.
4. Job titles that did not accurately describe the work being done, were changed to better reflect the duties of the job.
5. A small group of positions were moved to the Management, Professional and Technical Resolution because the duties fall under exempt status definition in federal labor laws.

The total cost for the three (3) year term of the contract related to the implementation of HAY effective October 1, 2018 is $661,000 to the General Fund and $332,000 to all other funds.  The below table details the cost per year per fund:

For FY19, the negotiating teams agreed to a 2.7% COLA retroactive to the first full pay period after July 1, 2018.  The 2.7% COLA is derived from the Consumer Price Index (CPI) annual change in cost of living as of the most recent annualized calendar year period.

In FY20 and FY21, effective the first full pay period after July 1 of each year, a COLA will be applied to pay rates of no less than 1.0% but not greater than 3.0%, based on the Consumer Price Index (CPI) as determined by the Bureau of Labor Statistics from comparing December to December of the previous year. The specific CPI agreed to by the parties is for the selected areas, all items index - Western Urban Size B/C - 50,000 to 1,500,000.  This CPI is a non-seasonally adjusted, annual index and will be rounded to the nearest one tenth decimal point (CPI Series ID: CUURN400SA0).

A new Appendix A will be issued including the COLA and the range adjustment when the information becomes available each year.

The below table details the cost per year per fund:

The total estimated fiscal impact of the COLA over the three (3) year Agreement to the General Fund ranges between $484,000 to $757,000 and between $925,000 to $1,439,000 in all other funds.

Section 2: Pay, Article C: Overtime

This section has been changed for clarification purposes and the additional language allowing an operational change on how overtime is assigned in the Public Works division.

Clarification Language

The work supervisor was added to clarify who is authorized to approve overtime. There is no direct cost related to this contract change.

Public Works Overtime Assignment – Employees within the Public Works Division specifically in the Parks Maintenance, Streets Maintenance and Utilities Maintenance Units may choose to be placed on an Opt-Out list.  Those on this list will not be called for overtime. The Opt-Out list does not apply to scheduled overtime or special event overtime, nor does it apply to overtime resulting from weather conditions, emergencies or a business necessity as determined by the City Manager, Department Director, Public Works Manager or designee. In such instances all Employees, even those on the Opt-Out list shall be required to report to work if requested to do so.

The Opt-Out list will be established once per quarter, and it is effective for 90 days. Employees who wish to be placed on the Opt-Out list are responsible for notifying in writing the appropriate staff.  An Employee’s status on the Opt-Out list does not automatically renew.   There is no direct cost related to this contract change.

Section 2: Pay, Article D: Special Assignment Pay

Records personnel within the Police Department will now be eligible for a special assignment pay of seventy-five dollars ($75.00) biweekly when training new employees within the Police Department.  The direct cost related to this contract change is $3,900 each fiscal year for the term of the contract for a total of $11,700.

Section 2: Pay, Article K: Tool Allowance

This section was changed to include the changed title of Equipment Mechanic III to Equipment Mechanic Lead.

Section 3: Benefits: Article A:  Group Health Insurance

There are three resolution changes in this Article. First, the schedule for sick leave conversion and sick leave cash out changed, allowing employees to become eligible for higher percentages of their sick leave earlier in their tenure with the City of Sparks. The cash-out conversion table has been changed to reflect a 20% payout after ten (10) years of service and a 35% payout after 15 years of service.

The potential liability in each fiscal year to the General Fund is up to $84,000 and for all other funds up to $80,000.

Second, upon nonservice related death of an employee, a section was added that allows the employee’s estate to receive a one-time payment of the employee’s sick leave balance subject to the cash-out schedule. The estimated fiscal impact is up to $25,000 to the General Fund each fiscal year and $25,000 in other funds each fiscal year.

Finally, language was added in the cash out section that allows the Finance Director the discretion to pay out if the remaining balance is nominally over the $15,000 or $25,000 cap.  This has no fiscal impact because this does not increase the cash value already owed to the employee.  There is no additional direct cost for this language change.

1. The Council may choose to approve the proposed Collective Bargaining Agreement.
2. The Council may choose not to approve the proposed Collective Bargaining Agreement.
3. The Council may choose not to approve the proposed Collective Bargaining Agreement and direct the City Manager toward another alternative.

I move to approve the Collective Bargaining Agreement between the City of Sparks and the Operating Engineers Local No. 3 Non-Supervisory Unit covering the period of July 1, 2018 through June 30, 2021.